Domestic producers witnessed a gloomy scenario in July this year with Qatar’s producer price index (PPI) registering a 1.5% decline month-on-month due to lower prices for hydrocarbons, refined petroleum products, basic chemicals, cement and electricity, according to official figures.
The PPI for the industrial sector  – a measure of the average selling prices received by the domestic producers for their output  – plummeted 26% year-on-year in July 2016, according to the Ministry of Development Planning and Statistics data.
MDPS had released a new PPI series in late 2015. With a base of 2013, it draws on an updated sampling frame and new weights. The previous sampling frame dates from 2006, when the Qatari economy was much smaller than today and the range of products made domestically much narrower.
The PPI for mining, which carries the maximum weight of 72.7%, saw its group index fall 1.5% month-on-month in July in this year on the back of a 1.5% decrease in the price of crude and natural gas; even as prices of stone, sand and clay rose 0.7%.
The PPI for mining witnessed the maximum plunge of 31.1% year-on-year in July 2016 owing to a 31.2% slump in the price of crude petroleum and natural gas; although stone, sand and clay prices firmed up 2.7%.
The manufacturing sector, which has a weight of 26.8% in the PPI basket, shed 1.8% month-on-month in July 2016 because of 3.8% decline in the price of refined petroleum products, 1.7% in cement and other non-metallic products, 1.6% in basic chemicals and 0.1% in grain mill and other products.
However, there was a 7.1% increase in the price of basic metals, 3.5% in man-made fibres, 3.4% in juices, 2.2% in dairy products, 1.9% in rubber and plastics products and 0.3% in beverages. The manufacturing sector PPI has seen a 15.7% shrinkage year-on-year on account of a 19.9% decline in the price of basic chemicals, 17.7% in refined petroleum products, 7.6% in basic metals, 1.9% in man-made fibres, 0.8% in dairy products and 0.1% in grain mill products.
Nevertheless, there was an 11.6% expansion in the price of juices, 3.7% in rubber and plastics products, 3.4% in cement and other non-metallic products, and 3.1% in beverages. Paper and paper products group index was however unchanged both month-on-month and year-on-year.
The utilities group, which has a mere 0.5% weightage in the PPI basket, saw its index gain 1.4% month-on-month in July this year as water prices soared 7.6%; even as electricity prices fell 2.9%.
The index had fallen marginally by 0.4% year-on-year, although water prices surged 7.2%; even as electricity prices fell 5.6%.